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Cumulus files for bankruptcy again

TheBigA said:
There is no "magic potion." This is why radio companies, including Cumulus, are transitioning their audiences to streaming, and investing in digital content creation.

By 2036, these companies will be primarily content companies, with the bulk of their revenue coming from things other than broadcasting.
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They are trying to transition their audience to streaming; doesn't mean they'll succeed.

If by digital content creation you mean listener focused digital content creation, count me as underwhelmed. I seldom if ever see any online content from a radio broadcasting company that is of any value, apart from "recently played" logs, which I do find valuable.

Of course, digital advertising vehicles and digital marketing strategy vehicles offered to advertisers is a whole other ballgame. This could be a profit driver but that is a fiercely competitive segment.
 
Cumulus and other legacy radio corporations are trying to paint an image that they are not slowly dying. In reality, they *are* slowly dying. Most of these companies should be regarded by investors as being in a managed, gradual wind-down. A possible reasonable analogous case would be Sears.
 
MarkW said:
Cumulus and other legacy radio corporations are trying to paint an image that they are not slowly dying. In reality, they *are* slowly dying. Most of these companies should be regarded by investors as being in a managed, gradual wind-down.
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Old media is dying. That means TV too. It's not just radio. The budgets and staffing created by old media aren't needed for new media.

So on the surface, if you base what a company does on what it once did, it's possible to conclude that these companies are dying.

But what's dying is consumer's old allegiances to local media. Today media usage isn't strictly local. It's global.

By going bankrupt, these companies are freeing themselves of the debt incurred from buying obsolete transmission systems.

Consider General Electric. At one time, they owned broadcasting. They owned local stations, and even owned NBC. Now, they're primarily involved in aerospace, healthcare, and energy. They don't make light bulbs or microwaves anymore. At one point it looked like GE was dying. But it's reinvented itself.
 
MarkW said:
They are trying to transition their audience to streaming; doesn't mean they'll succeed.

If by digital content creation you mean listener focused digital content creation, count me as underwhelmed. I seldom if ever see any online content from a radio broadcasting company that is of any value, apart from "recently played" logs, which I do find valuable.
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I've been streaming radio stations for almost 30 years. I don't look at station websites ever but I like listening to some station podcasts (Handel on the Law from KFI, Troubleshooter Tom Martino from KHOW).
 
MarkW said:
If by digital content creation you mean listener focused digital content creation, count me as underwhelmed. I seldom if ever see any online content from a radio broadcasting company that is of any value, apart from "recently played" logs, which I do find valuable.
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I agree with your assessment of the content quality, but, in 2024 (the last year numbers were publicly available for all three), Cumulus, iHeart, and Audacy had almost $1/2 billion in revenue from digital. Last year, Cumulus and iHeart got roughly $400 million from digital. I'm sure that includes the whole ball of wax from streaming, podcasts, websites, etc., but that's not peanuts.

MarkW said:
Of course, digital advertising vehicles and digital marketing strategy vehicles offered to advertisers is a whole other ballgame. This could be a profit driver but that is a fiercely competitive segment.
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It's also typically low margin, though radio has always been a low margin business itself. I'm not sure how much of the hundreds of millions Cumulus, iHeart, and Audacy get from digital translates to profit, but they're getting a large number of listeners and/or viewers that way to get revenues that high.

MarkW said:
Cumulus and other legacy radio corporations are trying to paint an image that they are not slowly dying. In reality, they *are* slowly dying. Most of these companies should be regarded by investors as being in a managed, gradual wind-down. A possible reasonable analogous case would be Sears.
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I've heard radio was slowly dying since the 80's. People were probably saying it before then. I don't think that's wrong necessarily, but plenty of money can still be made off transmitters. Radio has outlasted several of the people who told me the industry was dying, my dad among them.
 
Theater of My Mind said:
Mary Berner says they "right-sized" their balance sheet and eliminated approximately $600 million in debt.
Poof! All better.
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If you enjoy walking a tightrope.

According to an article in R / O ther "adjusted*" EBDITA was $9.5 million on $188.1 million (5%). That seems a little low but what do I know,? They even reported a 8.5 % DECREASE in digital revenue fourth quarter on 2025. I thought digital was the future. Shouldn't podcasts be in Digital? If so then they need to improve this area.

*Last time I looked at their website in the legal language there was a section about "non GAAP" according. Since this company most likely will never be a NASDAQ or NY Stock exchange company again that is logical. The only thing that matters is positive cash flow.

I believe the debt was retained so the bondholders who have taken a serious haircut will eventually get this money "tax free" not counting the interest which is taxable. If the company generates cash above paying the debt it would be carried over to the shareholders balance sheet and be taxable too. Of course when operating on this level, I am sure there are high paid Accountants and Tax Lawyers that will take care of the Shareholders / former debt holders if they start generating serious cash.
 
Kent said:
I agree with your assessment of the content quality, but, in 2024 (the last year numbers were publicly available for all three), Cumulus, iHeart, and Audacy had almost $1/2 billion in revenue from digital. Last year, Cumulus and iHeart got roughly $400 million from digital. I'm sure that includes the whole ball of wax from streaming, podcasts, websites, etc., but that's not peanuts.



It's also typically low margin, though radio has always been a low margin business itself. I'm not sure how much of the hundreds of millions Cumulus, iHeart, and Audacy get from digital translates to profit, but they're getting a large number of listeners and/or viewers that way to get revenues that high.



I've heard radio was slowly dying since the 80's. People were probably saying it before then. I don't think that's wrong necessarily, but plenty of money can still be made off transmitters. Radio has outlasted several of the people who told me the industry was dying, my dad among them.
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I believe TV was going to "kill off" radio in the 1950s
 
nomadcowatbk said:
will this year be any better with the midterms?
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Should be a little better but I personally doubt the political revenue will get them to profitably.

I kinda thought sports was going to be a shot to linear broadcasting but Cumulus' Westwood One (which I believe is where the sport's revenue shows up) was down 24%. And NBC Universal lost money with both the Winter Olympics and Superbowl.

IDK if the Nielsen dispute is going to affect sales in their top markets.

IMHO The non PPM markets don't have enough national agency money to really hurt the Cloud Company.
 
secondchoice said:
Should be a little better but I personally doubt the political revenue will get them to profitably.

I kinda thought sports was going to be a shot to linear broadcasting but Cumulus' Westwood One (which I believe is where the sport's revenue shows up) was down 24%. And NBC Universal lost money with both the Winter Olympics and Superbowl.

IDK if the Nielsen dispute is going to affect sales in their top markets.

IMHO The non PPM markets don't have enough national agency money to really hurt the Cloud Company.
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Remember, local and regional agencies are a big part of "agency money". When we talk about agency dollars, we need to look at the local shops that often manage things like car dealers, larger local retailers and the like.

In the roughly 40 years I was involved with management of stations in Puerto Rico, a top 20 market, I dealt with an average of over 100 local agencies. At top rated stations, as much as 95% of business was from agencies, and nearly all of that came from local agencies or local offices of shops like McCann and Y&R and so on. Very little came out of mainland U.S. offices.
 
davideduardo said:
Very little came out of mainland U.S. offices.
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We often blame the Internet, 80-90 new and move-ins, but IMHO the big box stores and national "dollar stores" have taken a lot of revenue and advertising out of a lot of markets too. Some of the new car dealerships are being gobbled by national companies too.

I believe you are correct about the future for a lot of the local radio survivors is local business.
 
TheBigA said:
The problem is they can't afford radio. Local pizza shops or hair salons can't afford to spend $100K on an ad campaign.
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I seriously doubt any locally owned restaurant or any business would spend $100k on an advertising campaign.
From your name "The Big A" your thinking of markets like Atlanta where such campaigns can happen.

It's the sub 200 markets or even non rated markets where an owner operator actually takes an interest in the station and the sales folks know their clients after calling on them for than 6 weeks. The station is not just a line on a spreadsheet*.

I will bet any successful salesperson that sells local on this board will tell you that they get results for their clients. If you sell a car dealership a package that results in 2 or 3 extra car sales the first weekend of the flight, you just stop by and pick up the orders from then on.

*Unfortunately I am afraid there will about a 20+% culling of these licenses thanks to "Wall Street style" debt, stations have really bad local advertising conditions (big box stores), and some stations will fall victim to declining rural populations.
 
secondchoice said:
I am afraid there will about a 20+% culling of these licenses thanks to "Wall Street style" debt, stations have really bad local advertising conditions (big box stores), and some stations will fall victim to declining rural populations.
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Keep in mind that debt isn't just a radio problem. Most of the local businesses that once advertised on radio have disappeared.
 


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